Understanding the Interconnectedness of International Trade Theories: A Case in Point of Cuba in Transition

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Understanding the Interconnectedness of International Trade Theories: A Case in Point of Cuba in Transition

Journal Title: SocioEconomic Challenges (SEC) - Year 2019, Vol 3, Issue 1

Abstract

This paper summarizes the arguments and counterarguments within the academic discussion on the issue of international trade and various barriers that hinders it. The main purpose of this article is to provide an overview of several foundational international trade theories related to exporting, importing, and trade restrictions for the national economy of a small socialist country, Cuba, with the United States of America. Some citizens are against trade between these two countries due to differences in political systems. However, the solution and relevant approaches for solving this trade restriction problem lies in effective and peaceful negotiations toward a brighter future, rather than allowing past conflicts to prolong the status quo of trade barriers. The relevance of the decision of this scientific problem is that modern data from 2018 indicates that most Cuban-Americans are in support of better relations between the Cuban and the United States governments. As such, we provide a historical review of politics, as well as economic growth and trade decline between the United States and Cuba over the past century to demonstrate how we got to this point of devastating embargos and restrictions in business, which hurt consumers. The methodological tools of the research for this paper are literature review, history of politics based on personal experiences of the authors with the two countries, and other secondary sources along with documented interviews with respondents from South Florida during November-December 2018. Investigation of the international trade barriers between Cubans and Americans in the paper is in the sequence of literature content, Cuban history and politics, personal analysis and discussion, and recommendations. As part of this process, foundational trade and economic theories such as comparative advantage and absolute advantage are covered and applied to trade between Cuba and the United States. Thus, we explain trade concepts for application in the context of Cuba as a case in point. Overall, the paper presents the findings of experts and empirical study results, which shows that both Cuban and American entrepreneurs and consumers can benefit from better trade relations between the two countries. The recommendations of this paper can be useful for policy makers and government officials in both the United States and Cuba. Towards the end, besides an academic overview of Cuban politics and trade, we provide suggestions and recommendations for decision-makers and those involved in international relations.

Authors and Affiliations

Bahaudin G. Mujtaba, Pedro F. Pellet, Jatuporn Sungkhawan

Keywords

international trade theory balance of trade trade restrictions absolute comparative and competitive advantage factor endowment Cuba

EP ID EP512746
DOI 10.21272/sec.3(1).27-41.2019
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